fuboTV(US:FUBO)2024-11-01 20:17Revenue and Subscriber Growth - Fubo's subscription revenue is primarily generated through its website and third-party app stores, offering basic plans with optional add-ons and features[163][175] - Fubo's revenue and subscriber additions peak in Q3 and Q4, driven by the start of the NFL and college football seasons[173] - Total revenues for Q3 2024 increased to $386.2 million, up by $65.3 million (20.4%) compared to Q3 2023, driven by a $67.0 million increase in subscription revenue[189] - Subscription revenue for Q3 2024 rose to $356.6 million, up by 23.1% YoY, with $50.5 million from subscriber growth and $16.5 million from higher subscription prices and attachments[189] - North America paid subscribers increased to 1.6 million as of September 30, 2024, compared to 1.5 million in 2023, while ROW paid subscribers remained stable at 0.4 million[209] - North America ARPU increased to $85.64 for Q3 2024, up from $83.51 in Q3 2023, while ROW ARPU rose to $7.50 from $6.98 during the same period[211] - Subscription Revenue (GAAP) for Q3 2024 was $356.6 million, up from $289.6 million in Q3 2023, while Advertising Revenue (GAAP) decreased to $27.1 million from $30.6 million[214] Advertising Revenue and Competition - Fubo's advertising revenue is derived from fees charged for displaying ads within streamed content, competing with traditional media and other streaming platforms[171][177] - The company faces significant competition, including from Disney, Fox, and WBD's proposed sports streaming service, which could impact subscriber growth and profitability[168] - The company operates in a highly competitive environment, with aggressive promotions by competitors potentially affecting its value proposition[167] - Advertising revenue for Q3 2024 decreased by $3.5 million (11.4%) to $27.1 million due to fewer impressions sold[189] Operating Expenses and Costs - Subscriber-related expenses, primarily content streaming costs, represent the largest component of the company's operating expenses[172][178] - Subscriber-related expenses for Q3 2024 increased by $31.6 million (11.0%) to $317.7 million, primarily due to higher affiliate distribution costs and subscriber growth[191] - Broadcasting and transmission expenses for Q3 2024 decreased by $0.8 million (5.3%) to $14.4 million, driven by cloud infrastructure optimization[193] - Sales and marketing expenses for Q3 2024 decreased by $5.3 million (8.8%) to $55.2 million, mainly due to reduced marketing and stock-based compensation costs[195] - Technology and development expenses for Q3 2024 increased by $3.7 million (21.1%) to $21.2 million, primarily due to higher payroll costs[196] - General and administrative expenses for Q3 2024 increased by $10.7 million (67.3%) to $26.5 million, driven by higher legal fees and payroll expenses[197] Financial Performance and Profitability - Gross Profit for Q3 2024 was $54.1 million, a significant increase from $19.7 million in Q3 2023, with Gross Margin improving to 14.0% from 6.1%[213] - Net loss from continuing operations for Q3 2024 improved to $54.7 million, compared to $84.5 million in Q3 2023, reflecting better operational performance[187] - Other income for Q3 2024 was $4.1 million, a $5.6 million improvement YoY, primarily due to a $7.8 million gain on debt extinguishment[200] Cash Flow and Financial Position - The company repurchased $46.9 million principal amount of the 2026 Convertible Notes for $27.1 million during the nine months ended September 30, 2024[219] - The company sold 33.2 million shares of common stock under the ATM Program, generating net proceeds of approximately $43.3 million during the nine months ended September 30, 2024[220] - As of September 30, 2024, the company had $152.3 million in cash, cash equivalents, and restricted cash[221] - Net cash used in operating activities decreased to $96.5 million during the nine months ended September 30, 2024, compared to $173.0 million in the same period of 2023[226] - Net cash used in investing activities decreased to $11.3 million during the nine months ended September 30, 2024, compared to $16.1 million in the same period of 2023[227] - Net cash provided by financing activities decreased to $11.5 million for the nine months ended September 30, 2024, compared to $114.5 million for the same period in 2023, primarily due to lower proceeds from the ATM Program and repurchases of convertible notes[228] - Net cash used in operating activities increased to $2.8 million for the nine months ended September 30, 2024, compared to $2.6 million for the same period in 2023, driven by the wind-down of Fubo Sportsbook[230] - As of September 30, 2024, the company had $152.3 million in cash, cash equivalents, and restricted cash, with $330.2 million of outstanding indebtedness, including $144.8 million of 2026 Convertible Notes and $177.5 million of 2029 Convertible Notes[241] Content and Business Model Risks - The company's ability to acquire and retain desirable content at competitive prices is critical, with increasing content costs posing a risk to margins[172] - Fubo's business model depends on growing ad inventory and shifting advertising dollars from traditional TV to connected TV, which may be impacted by macroeconomic conditions[171] - Fubo relies on paid marketing channels (e.g., social media, search advertising) to grow its brand and attract new subscribers, with potential risks if these channels become less efficient[166] Discontinued Operations and Impairment - The company ceased operations of its Fubo Sportsbook on October 17, 2022, with results reported as discontinued operations[164][165] - The company conducted a goodwill impairment test as of March 31, 2024, due to sustained decreases in stock price and market capitalization, and determined that goodwill was not impaired[234] - The March 31, 2024 goodwill impairment test allocated 50% to income-based and 50% to market-based approaches, with significant inputs including a control premium of 20.0%, a discount rate of 31.5%, and revenue multiples of 0.4x to 0.5x[236] Currency and International Revenue - Revenues denominated in currencies other than the U.S. dollar accounted for approximately 2.3% of consolidated revenues for the three and nine months ended September 30, 2024[242]